By Legal Futures Associate Checkboard [1]
These days, sanctions compliance is under constant scrutiny. And while most law firms probably aren’t worried about the United States Navy turning up at their door for sanctions busting, the consequences of getting it wrong are still extremely serious.
Sanctions non-compliance can trigger major regulatory action, leading to financial penalties, reputational damage, and even criminal liability.
In a legal environment where regulators increasingly expect firms to demonstrate proactive risk management, simply performing checks at the onboarding stage is no longer enough.
Firms need to prove they are constantly monitoring their clients for any exposure to sanctions risk, whether by association with sanctioned individuals or organisations, or by actually being listed themselves. And they need to do so in a way that stands up to scrutiny.
Keeping up with world events
Despite this, we know many firms are still over-reliant on manual processes: checking client names against a list and maintaining records in spreadsheets.
Not only is this time-consuming, but it’s highly prone to human error. Names can be misspelled, details can be missed, and results can be misread, especially when teams are busy dealing with other client matters.
Moreover, rapidly unfolding world events are adding to the challenge. When new individuals and entities are being added overnight, and new aliases and corporate structures are being created to obscure sanctions links, teams can struggle to keep up.
Automating the process
That’s why automation is the way forward.
Checkboard helps firms keep on top of their sanctions responsibilities through automated daily monitoring over a 12-month period.
Instead of one-off checks, we continuously screen clients throughout the matter lifecycle, checking politically exposed persons (PEPs), sanctions lists, mortality data, and adverse media sources. Any red flags are highlighted as they emerge, giving firms the opportunity to act quickly and confidently.
If a potential match is flagged, the firm can immediately investigate, document the outcome, and show regulators that compliance wasn’t treated as an afterthought.
Reduce your exposure to risk
Ultimately, automated monitoring reduces exposure to both financial and criminal risk and helps firms avoid unwanted regulatory attention in the form of fines, enforcement notices, and reputational harm.
In today’s environment, where scrutiny is only increasing, automated sanctions monitoring isn’t just a helpful procedural tool, but an essential tool in the compliance toolkit [2].
Ready to reduce your exposure to sanctions risk? Get in touch with Checkboard [3].